SMM Analysis Of China Silicon Metal Production In May And Forecast For June

According to SMM, China's silicon metal production in May was 408,100 mt, up 13.8% MoM (+49,400 mt) and 50.4% YoY (+136,800 mt). In January-May, the silicon metal production totalled 1.823 million mt, up 27.54% YoY (+393,800 mt).

The nearly 50,000 mt increase in May was due to two main factors. First, leading producers in Xinjiang continuously increased their workload, reaching near full capacity and achieving a record high production. Currently, the operating rate of the three major producers in Xinjiang has increased to extremely high levels. Second, silicon plants in Sichuan resumed production in batches during the transitional period from the dry season to rainy season in May, leading to a rapid increase in supply. By early June, the operating rate in Sichuan has increased to over 60% (based on the number of furnaces). Other regions saw minimal fluctuations in silicon metal supply in May.

In June, the expected increase in silicon metal supply will mainly come from the production areas in Yunnan and Sichuan. With an edge in power costs over Yunan, Sichuan saw faster production resumption. Many silicon producers in Dehong Dai and Jingpo Autonomous Prefecture, Yunnan, plan to restart in late June. There will be marginal supply increases from small capacity expansions in Inner Mongolia, Gansu, and other regions. The slight production reductions in high-cost areas like Fujian have limited impact. Overall, it is expected that silicon metal production in June will increase from May to over 420,000 mt.